Chinese funds flood Burmese border city on the edge of the law

By Andrew Jacobs / NY Times News Service, MONG LA, Myanmar

Fri, Feb 28, 2014 - Page 9

The smuggling route into this rebel-run jungle outpost just over the Chinese border begins on the back of a motorcycle that takes passengers through steeply terraced rubber plantations and skirts the official crossing before ending at an outdoor market where bedraggled prostitutes mingle with Chinese tourists haggling over tiger claws, bear paws and desiccated squares of elephant skin.

At US$14 each way, the 20 minute ride is a relative bargain, although the price does not include payoffs to teenage Burmese insurgents at impromptu checkpoints along the way.

Tucked into the verdant forests of Myanmar’s eastern Shan state, Mong La is better known here by its Chinese name, Xiaomengla, in part because the vast majority of its residents are Chinese, as are most of the illegal day-trippers, drug mules, Christian missionaries and comely young croupiers who work in the city’s 20 casinos, most of which are Chinese-owned.

Mong La has a hilltop Buddhist temple and a picturesque colonial church, but vice and self-indulgence, not sightseeing, are the city’s main draws.

“There’s not much to do here but gamble and eat wild animals,” one Chinese matron said with disdain.

Mong La runs on Beijing time, 90 minutes ahead of the rest of Myanmar. Cellphone service and electricity are provided by China. China’s yuan, not the Burmese kyat, is the only currency accepted at the city’s roulette tables, storefront brothels and Sichuan-style restaurants.

As Myanmar embraces democracy after decades of military dictatorship, Mong La, the domain of a former communist rebel turned warlord-entrepreneur, is a glaring reminder of the challenges Myanmar’s government faces in taming the patchwork of rebel-held territories along its northern frontier.

Sai Leun, the warlord who runs what is officially known as Special Region No. 4, employs several thousand armed men who, for the moment, peacefully coexist with Burmese troops and the ethnic Wa militia that controls a neighboring piece of territory.

Despite its longstanding economic and historic ties to the region, China has a conflicted relationship with Mong La. A decade ago, alarmed by the legion of officials gambling away stolen public money, Chinese soldiers poured across the border to shut down the casinos. In response, Sai Leun simply orchestrated the construction of new gambling parlors 16km farther south of the border in a virgin tract of jungle.

In 2012, when China severed cellphone service to the area in an effort to choke off Internet gambling, casino owners brought in satellite dishes to maintain the flow of money from those who prefer to bet from the comfort of Shanghai, Guangzhou and other Chinese cities.

Analysts say the Chinese are reluctant to pull the plug entirely — something it could easily do by blocking cross-border traffic or by cutting off the electrical supply flowing south from adjacent Yunnan Province.

“If we banned tourism entirely, it would harm more than just the casinos and hit a lot of businesses that support the local economy,” said Zhu Zhenming (朱振明), an expert on China-Myanmar relations at the Yunnan Academy of Social Sciences.

Officially, at least, Beijing tries to limit access to the city by requiring its citizens to obtain special permits; outside each casino, large red signs remind Chinese that they are forbidden to enter.

In reality, Mandarin speakers fill nearly every seat at the baccarat tables and electronic slot machines. Few bother applying for a pass and instead sneak in, via motorbike or by climbing through large holes conveniently located on the border fence.

Vincent Nijman, a zoologist at Oxford Brookes University in England, said Mong La has become one of Asia’s largest markets for endangered wildlife. In recent years, he has cataloged about 40 rare and threatened species at the market, among them a hairy-nosed otter — an animal that until recently had been believed to have been extinct.

During his most recent visit in January, Nijman and a colleague from the conservation group Traffic counted 49 whole elephant tusks and 3,300 pieces of ivory for sale.

“There’s absolutely no attempt to hide anything,” he said. “The scale of the trade is shocking.”

At night, Mong La resembles a neon spaceship that crash-landed in the jungle, but the potholed streets are thick with desperation.

“I came here a rich man, and now I have nothing,” said a 43-year-old cabdriver, a former businessman from Chongqing, who said he gambled away nearly 700,000 yuan (US$115,000), more than a decade ago.

The driver, who gave only his surname, Zhang (張), said he longed to be with his family but could not leave until he earned enough money to regain his pride.

“I won’t let my family come here, because this is no place for children,” he said before turning his attention back to the poker game on his cellphone.

Having borrowed money from loan sharks, some residents are trapped as they await money from relatives. Others are outlaws who have found refuge in a lawless land. Liu Qiao (劉喬), 40, a blustery man from northern China, fled here in 2009 after gambling away what he said was US$1.6 million that belonged to his mining company.

Fearing arrest if he returns to China, he found work as a so-called casino agent, escorting wealthy gamblers to casinos and arranging cash advances through a company that gives him a small cut of each loan. Asked what happens to those who cannot repay their debts, Liu smiled uncomfortably.

“You don’t leave until you pay,” he said.

With many of his Chinese customers spending the Lunar New Year holiday at home with family, Liu was eager to accompany a group of Western visitors he mistook for high-rollers. After a bone-rattling drive along the unfinished road that connects the city center to the gambling district, he showed off the Casino Lisboa, a Thai-themed gambling hall presided over by a large Buddha, and the Royal Casino, its brightly lit facade dressed in fluted columns and Roman centurions.

Inside, the mood was quietly tense as chain-smoking gamblers hovered over their chips, making bets as high as US$33,000. Sharing the tables were scores of young men and women with headsets. Their job: to play the hands of remote Chinese bettors who followed the action through live video feeds.

Over dinner, Liu lamented that his gambling addiction had destroyed his family and the mining company, started with friends, that has since gone belly up.

“I’ve lost all face,” he said.

However, his mood brightened as he took one more stroll through the casino floor. He paused at a roulette table, threw down a 100 renminbi note bearing the face of Mao Zedong (毛澤東) and waited. When the ball dropped, he picked up 200 yuan from the table and walked out into the night, a smile on his face.